Harrington Collection 2

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Harrington Collection: Sizing Up the Active-Wear Market Harrington Collection is a manufacturer and retailer of high-end women’s clothes. It was founded in 1960 and it focused on the design and manufacturing of formal dresses. As the company evolved however, it incorporated suits, pants, blouses, coats and other professional dress items into their offerings. Harrington is divided into four divisions; Harrington Limited – sophisticated elegance, Sopra – status seeker, Christina Cole – office chic, and Vigor – trend setters. They have become synonymous with high class fashions and their customers are extremely loyal.
However, in the past three years sales have been down and the company is suffering. The women’s clothing industry has
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Sales Units in 2009 = 15 million units x 7% x 40% = 420,000 units
420,000 – 289,846.1 = 130,153.9 units above breakeven
These calculations show that the worry that Karen Allen is having is not valid because Harrington Collection is forecasted to sell 130,153.9 units over the breakeven point. This also creates an attractive profit margin:
$6,304,590 profit x 15.8% tax = $5,308,464.78
The Vigor label is the division of Harrington that the active-wear line would be integrated into. This is because Vigor lines were less traditional and the business clothes in this line were focused on comfort and fashion which the active line wants to encompass. Another worry of Harrington managers was that introducing a line that is not as sophisticated as their other professional clothes will diminish the brand and the reputation which Harrington has built for themselves over the past 50 years. However, another research survey which was conducted examined if customers would have that impression when an active-wear line were to be introduced. When the results were analyzed, it was found that less than 2% of customers thought that a less-expensive active-wear brand would cheapen the Harrington name. There is also the question of where the line would be sold. Should it be in department stores or specialty stores? Harrington Collection should approach this question

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